Grand Union Tea Co. v. Walker

• Decision Date: 16 April 1935
• Docket Number: 26,382
• Citation: Grand Union Tea Co. v. Walker, 208 Ind. 245, 195 N.E. 277 (Ind. 1935)
• Parties: Grand Union Tea Company v. Walker
• Court: Indiana Supreme Court

195 N.E. 277

208 Ind. 245

Grand Union Tea Company v. Walker

No. 26,382

Supreme Court of Indiana

April 16, 1935

From Vanderburgh Superior Court; Benjamin E. Buente Judge.

Action by the Grand Union Tea Company against Ivan W. Walker to enjoin competition in business in violation of an employment contract.From a judgment for defendant on demurrerplaintiff appealed.Transferred from the Appellate Court.

Reversed.

Joseph H. Iglehart, for appellant.

J. L Sanders and F. P. Bamberger, for appellee.

OPINION

Hughes, J.

This is an action by the appellant, Grand Union Tea Company, against the appellee, Ivan W. Walker, to enjoin continued violation by the appellee of negative covenants in a written contract of employment between the parties, and to recover damages for breach of the contract by the appellee.The complaint is in one paragraph.Appellee demurred to the complaint on the ground that it did not state facts sufficient to constitute a cause of action.The demurrer was sustained and appellant having elected to stand on the court's ruling on the demurrer, failed to plead further and brought this appeal.

The assignment of error is as follows: The superior court of Vanderburgh county erred in sustaining appellee's demurrer to appellant's complaint.

It appears from the complaint that the appellant is a corporation organized under the laws of the State of New Jersey and had been engaged in the business of selling teas, coffees, and other merchandise, in the states of Indiana, Illinois, and Kentucky.

That on or about the 17th day of December, 1928, the appellant employed the appellee, Ivan W. Walker, as a head salesman with headquarters in Evansville, Indiana, to assume control of and be responsible for routes assigned to him in territory in said states, and to train and assume control of salesmen and other employees as directed by the appellant and to solicit orders for and deliver merchandise handled by the appellant.

That from said 17th day of December, 1928, until the 2nd day of April, 1932, the appellee worked for appellant and performed such duties for which he was employed; from September 26, 1931, to March 17, 1932, appellee performed the duties of branch manager for appellant with headquarters in Evansville, Indiana.

That the appellee worked for the appellant continuously from the 17th day of December, 1928, up to and including the 2nd day of April, 1932.That during said period of appellee's said employment by the appellantthey entered into written contracts which were of the same general tenor and effect, the first of which was executed and entered into by said parties on the 17th day of September, 1928; another written contract was executed and entered into by said parties on the 8th day of March, 1930; that another such written contract was entered into by said parties on the 21st day of July, 1930; and another one on the 26th day of September, 1931; and another one on the 17th day of March, 1932, and that under said last mentioned contract said appellee was employed by and acted as head salesman for the appellant until the 2nd day of April, 1932.That on said 2nd day of April, 1932, appellee's employment by appellant was terminated.

That the contract so entered into consisted of twenty-three sections.That the first section provides as follows:

"The Company hereby employs the Head Salesman for a term of eighteen (18) months to perform, under its direction, the duties of a Head Salesman as provided for by the terms of this agreement and by the rules and regulations of the Company now or hereafter in force.The Company agrees to pay the Head Salesman a salary at the rate of $ 37.50 per week for each week the Head Salesman is actually engaged in the service of the Company."

The ninth section provides: "The Head Salesman further agrees that on the termination of his services, for any cause, or upon the presentation of a written order by any authorized agent of the Company, he will promptly turn over to the Company, or such agent, lists of customers, all books of accounts, papers, orders and all other property belonging to it or used in its business."

The tenth section provides: "The Head Salesman agrees that during his employment with the Company and after the termination of his services, for any cause, he will not divulge to any person or persons, not connected with the Company, any of its business methods, forms, names or addresses of customers; and the Head Salesman further covenants and agrees that he will not at any time while in the employ of the Company, nor within a period of Eighteen Months after the termination of his services, either:

"(1) For himself, or any other person, firm or corporation, directly or indirectly, engage in the business of selling Teas, Coffees, Baking Powders, Spices, Extracts, Soaps or other merchandise handled by the Company during his period of employment within any county in which his headquarters have been, nor in any of the territories or delivery routes which shall have been assigned or entrusted to him or placed in his charge or under his direction by the Company, either as Head Salesman or in any other capacity; or, . . .

"(3) For himself or any other person, firm or corporation, directly or indirectly, solicit or take orders for or sell or deliver any such merchandise in such county, territories or delivery routes; or

"(4) In any way, directly or indirectly, solicit, divert, take away or interfere with, or attempt to solicit, divert, take away or interfere with any of the custom, trade, business or patronage of the Company in such county, territories, or delivery routes, or in any way, directly or indirectly, interfere or attempt to interfere with any of the salesmen or solicitors who shall be employed by the Company, or induce or attempt to induce any of them to leave the employ of the Company or violate the terms of their contract with it."

Section eleven provides: "If the Head Salesman fails to perform the services required to the complete satisfaction of the Company or fails to perform any one or more of the terms and conditions of this agreement to be by him performed, the Company may terminate this contract without notice and dispense with the services of the Head Salesman."

It is further alleged in the complaint that during said time which appellee was employed by the appellant as aforesaid, the appellee became fully acquainted with appellant's methods in conducting its said business and became personally acquainted with appellant's customers and their residences in and on its delivery routes in Southwestern Indiana and Northwestern Kentucky.

That the employment of appellee terminated on the 2nd day of April, 1932.That immediately thereafter, and within less than one month after the 2nd day of April, 1932, the appellee, in violation of the provisions and terms of his said contract with appellant, proceeded to open up and engage in the business of selling and to sell teas, coffees, and other merchandise which had been handled by the appellant as aforesaid, within said City of Evansville, Indiana, and within Vanderburgh County, Indiana, in which city and county appellee's headquarters had been located throughout the entire period he was employed as head salesman by the appellant as aforesaid.

That since said 2nd day of April, 1932, appellee has been engaged and is now engaged, indirectly through others, in soliciting, diverting, taking away interfering with, and in attempting to solicit, divert, take away and interfere with, the custom, trade, business and patronage of the appellant in such counties, territories and delivery routes in said southwestern portion of Indiana and in said northwestern portion of Kentucky.That such custom, trade, business and patronage of the plaintiff in such counties, territories, and delivery routes were of great value to the appellant, and that same had been established and developed at great cost and expense to the appellant, and that the aforesaid action of appellee in soliciting, diverting, taking away and interfering with the same, and in selling such goods and merchandise as aforesaid has greatly damaged the appellant, and that the continued action of appellee in that regard will cause further damage to the appellant.

Appellant prayed for an injunction against the appellee enjoining and restraining the appellee from directly or indirectly soliciting, diverting, taking away or interfering with, or attempting to solicit, divert, take away or interfere with any of the custom, trade, business, or patronage of the appellant, in the...